What follows is the transcript of my interview on Kudlow and Company last night with former Republican presidential candidate, Massachusetts Governor Mitt Romney.
Kudlow: A lot of conservatives think that Senator John McCain and Mitt Romney would make a lovely couple. So here to tell us about this relationship is a great friend of this program, former presidential candidate, Governor Mitt Romney of Massachusetts. Welcome back to the show, sir.
Romney: Thanks Larry. Good to be with you.
Kudlow: Let me begin with this. “The Great Mentioner in the Sky” has you very high on the veep candidate list. Before I ask you about that part of it, I want to kind of turn the tables. If you were the presumptive nominee of the GOP, what are the one or two key qualities that you’d be looking for in your vice president?
Romney: Well, I’m not the presumptive nominee. So I haven’t given a lot of thought to that. But I think history says that the most important characteristic that you look for in a VP is someone who could become the president, in the case that were necessary. That’s what people look for. They’re not looking for anything other than that. Could this person lead the country in a critical time? And these are critical times. So I think you’ll find both parties, the candidates of both parties, selecting individuals who they think could be great presidents if necessary. And people who hopefully could add some political clout as well.
Kudlow: Right now, Mr. McCain is really getting all of it his way. Hillary and Obama are just killing each other. Senator McCain is surging in the polls. But as we move down the road, and we get to the conventions, and we get to the fall campaign, aren’t the two key issues going to be Iraq and the economy?
Romney: You know, I think you’re right. I think people will come home to their party. People talk before an election about how divided the parties are by virtue of the primary. But, after each party has selected their nominee, I think what happens is that people focus on the issues and the differences as to where the candidates would take the nation. And in the case of Senator McCain, he’s made it very clear. He’ll do whatever is necessary to protect the American people. And he’ll also strengthen our economy by reining in spending, and by keeping our tax burden low. By helping people get health insurance, but not by adding hundreds of billions of dollars of new costs in Washington. He will restrain government and grow the economy in the private sector. That’ll make the difference.
Kudlow: What would you recommend to deal with the mortgage mess which appears to be pulling down the economy? Fed head Bernanke today suggested the “r” word for the first time—maybe a small contraction in the first half. How would Governor Mitt Romney solve the mortgage mess?
Romney: Well, I think when you look at the economy, you have to consider that there are two long-term trends that you’re concerned about. One is the up and down cycles. And that’s what’s happening in the subprime mortgage crisis. And the other is the long-term trend for the economy. And, on the short-term, the ups and downs of the mortgage crisis, I think what you have to do is first of all, help homeowners who may lose their homes. Help them stay in their homes, if they can meet the, if you will, the most basic payments of their mortgage. And you want them to stay in homes, instead of having more homes fall into foreclosure. It hurts families. Of course it hurts the market as well. And Secretary Paulson has made a number of recommendations to do just that. You also want to make sure there’s enough credit in the market to keep the credit crunch in one area of the economy—mortgages—from affecting the overall economy. And the Fed has taken action in that regard as well. Longer term however, I think you have to say why is it that people are taking their investments out of dollars, out of America? Why are they concerned about our future? And I think it’s because of overspending in Washington. Over-government spending. And that’s something which is going to have to change.
Kudlow: Do you think a stronger dollar becomes a campaign issue at any point? A lot of people believe the weak dollar has created currency risk, along with the credit risk of the mortgage problem. And that’s kind of stopped foreigners from investing here.
Romney: You know, I think as an overall campaign theme, people are not going to get focused on strong dollar—I think most people don’t really give a lot of thought to currency relationships. But I do think that they’re concerned about, “Is America strong”? And, are we going to be a strong and vibrant economy going forward? And, who is the person most capable of keeping America strong economically? And of course, if you want to see strength in our economy, strength in our dollar, you want to see people of the world recognize that the obligations that our government has made, are obligations it can keep. And right now that means we’re going to have to reform entitlements. And we’re going to have to rein in this tendency of Washington to keep on spending, spending, and spending. And when it comes to spending, I don’t think anyone in Washington has a better record than John McCain at restraining unnecessary and pork-barrel spending.
Kudlow: You have a strong investment background. Would you buy the stock market right now? For the long run?
Romney: Well the answer is yes. You know, when things are soft, when people are fleeing, that’s a good time typically to be investing. I believe in the long-term strength of America. I think we’ll make the right choices this November. I think we will continue to lead the world by virtue of being the most innovative economy in the world. And so I think America’s future is bright. But we’re going to have to make some tough decisions in Washington. And instead of promising people things that we can’t possibly deliver, and putting burdens on our kids and on taxpayers, we’re going to have to finally spend what we take in, instead of spending more than we take in.
Kudlow: We’ve got a brief [video] clip. You endorsed Senator McCain back in mid-February. And he made some comments about you. Let’s take a look at this for a moment.
[Text of McCain’s comments: “I look forward to campaigning with Governor Romney. And I look forward to his continued, very important, role of leadership in our party that he has exercised in the past, and will exercise even more so in the future. Governor Romney, I thank you…I am honored, I am very honored, to have Governor Romney and the members of his team at my side.”]
Kudlow: Mr. Romney, you were with [McCain] in Salt Lake City, what a week or ten days ago? What did you guys talk about when you were out there?
Romney: Well, we had some fun. We were in Salt Lake, and in Denver. We were talking to donors and I expressed confidence in the future of the McCain campaign. I’ve asked my donors to be generous in supporting his campaign. I want to make sure we elect John McCain the next President of the United States. And so we spent some time talking about the economy. We talked about the fun of the campaign—some of the humorous experiences we’d had. I spent some time getting to know his campaign team. And it was fun being back on a campaign airplane, seeing members of the press again—some of whom used to follow my campaign.
Kudlow: When you were with him, did you get good vibes from him? How’s your relationship with him?
Romney: You know, we get along very well. Senator McCain was kind enough to campaign for me in ’94, when I ran against Ted Kennedy. He campaigned again for me when I ran in the governor’s race. We’ve been friends on a number of fronts. We worked together on the Olympics. And while we didn’t see everything eye-to-eye, throughout the campaign, we do believe the same things about strengthening our national defense, about strengthening our economy by keeping the scale of government down, and lowering taxes. We care very deeply about America becoming energy independent. We want to see more people have health insurance. So, on major issues of the day, Senator McCain and I are on the same page.
Kudlow: So if he asks you to serve as his veep, would you take it?
Romney: You know, I think, I frankly think any Republican leader in this country would be honored to serve with Senator McCain as his running mate. And he’s got a long list of people he can turn to. I’m not going to conjecture as to who it might be. But I think there’s some terrific people, and he’ll make a choice there. But I’m certainly not holding my breath.
Kudlow: Could you carry Massachusetts?
Romney: I’m not going to make any predictions in that regard.
Kudlow: Do you think Mr. McCain needs a strong governor with executive experience who knows the economy?
Romney: Oh, I’m always partial and in favor of governors. I think governors bring a lot to a national ticket. But there are also some great senators and other leaders in our party who I’m sure he’s considering.
Kudlow: Alright, Governor Mitt Romney. We appreciate it. It’s wonderful to see you again sir. All the best of luck.
Romney: Thanks Larry. Good to be with you.